A CRA expert provided input to the Canadian Competition Bureau in its evaluation of the proposed merger of two branded pharmaceutical manufacturers. CRA’s team considered the ability and incentive of the merging parties to increase the price of a branded pharmaceutical following the merger. Aspects of this consideration included setting out the features of list and net pricing of branded drugs in the Canadian pharmaceutical marketplace, and the various constraints and factors that bear on those prices.
How capacity constraints shape unilateral price effects in horizontal mergers
Examples include hospitals with a fixed number of beds, and hotels with a fixed number of rooms. In the article “Unilateral Price Effects in Horizontal...